A former Sterling Inc. employee who led a ring of family and friends that pawned more than $500,000 of diamonds stolen from the jeweler has been arrested after a six-month investigation. The person was identified as Farrah Daly, 26, by police in Akron, Ohio, where Sterling, the second largest U.S. retail jeweler, is headquartered. More arrests are expected, though no other Sterling employees are involved, say police.

Daly, a former diamond sorter at Sterling, was arrested Nov. 7, and charged with aggravated theft and engaging in a pattern of corrupt activity, Akron police Det. Paul Bralek of the pawn detail, told JCK. Daly was “the primary perpetrator of the thefts,” he says. Also arrested was her husband Michael Daly, 26, who was charged with engaging in a pattern of corrupt activity. Both were freed on $100,000 bail.

Bralek told JCK that 17 people were involved, though most weren’t criminally complicit. Five more people will be charged, probably this month.

At least 39 diamonds of varying grades and colors and weighing between 1 cts. and 3 cts, were stolen. “Those are the ones we’ve been able to document so far, but there are probably more,” says Bralek. Daly, in statements to police and Sterling Inc., couldn’t recall exactly how many she allegedly took. Because of that, says Bralek, the retail value of the stolen gems could be as high as $800,000. Only three of the stolen diamonds have been recovered.

Akron police about two years ago first noticed an increase in loose diamonds coming into local pawnshops, says the Akron Beacon Herald. They began taking note of who pawned the diamonds, but couldn’t locate the source.

Then in May this year, says Bralek, a Sterling security video allegedly showed a diamond drop out of Daly’s clothes as she bent over to remove her shoes when she was going through a company security checkpoint at the end of the day. Sterling’s security people contacted Akron police, and “we’ve worked closely in tandem with them on this since then,” says Sterling spokesman David Buffard, vice president of marketing. Daley was put under investigation and later fired by the company.

According to police and published accounts, Daly allegedly said she began stealing diamonds from Sterling in 1999. She reportedly told police she and her husband would conceal one or two gems at a time inconspicuously in her clothes, hair or even her mouth and take them home when she finished work. Later, she and her supposedly would ask relatives or friends, who were sometimes paid $100 to $300, to sell the gems at local pawnshops and jewelry stores and allegedly bring them the money. Daly and her husband “made up stories about how they got the diamonds, so not everyone involved knew the stones were stolen,” Bralek told the Akron newspapers and JCK. “Most thought they were just doing a favor for them.” No friend or relative was used more than twice. Though her husband pawned a couple diamonds, Daly herself never did.

Buffard declined to comment on the investigation. He did tell JCK, that Sterling has “confidence in our employees and in our long-standing security measures, but as result of this action, we have strengthened an internal security policy.”

JCK